Delta Corp, a prominent player in India’s casino and online gaming industry, recently released its financial report for the three months ending on March 31, 2024. Despite facing challenges in its casino and online skill gaming segments, the company showcased resilience, reporting a sequential increase in profit. However, it continues to grapple with legal issues related to GST demands on its subsidiaries.
Financial Performance Overview
In the first quarter of 2024, Delta Corp recorded a gross income from operations of Rs 222.75 crores, reflecting a 3.0% decline year-on-year and a 5.0% decrease sequentially. The decline was primarily attributed to decreases in both casino and online skill gaming segments. Income from gaming operations stood at Rs 174.07 crores, down from the previous quarter and the same period last year.
Income from online skill games experienced a significant decline of 10.4% compared to the previous quarter, amounting to Rs 35.08 crores. Similarly, income from hospitality saw a slight dip of 1.0% to Rs 13.60 crores.
Despite the challenges, Delta Corp reported a remarkable 110% sequential increase in profit for the quarter, reaching Rs 72.41 crores. This surge was largely influenced by the sale of a subsidiary, demonstrating the company’s strategic maneuvering in the face of adversity.
Annual Performance and Profit
For the fiscal year ending on March 31, 2024, Delta Corp witnessed a 2.5% year-on-year decline in gross income, totaling Rs 1,010.48 crores. Gaming operations saw a slight decrease of 1.5% to Rs 812.83 crores, while income from online skill games experienced a more significant drop of 9.5% to Rs 146.80 crores.
Profit for the year amounted to Rs 244.23 crores, reflecting a 6.6% decrease compared to the previous fiscal year. These figures indicate the challenges faced by Delta Corp in maintaining its profitability amidst evolving market dynamics and regulatory pressures.
Legal Challenges and GST Demands
Delta Corp continues to grapple with legal challenges stemming from GST demands on its subsidiaries. Last year, notices were issued demanding back payment of 11,439.49 crores for alleged short payment of GST. In response, Delta Corp and other affected companies have elevated Writ Petitions opposing these demands to the Supreme Court.
The company has emphasized that these claims are based on the gross bet value of all games played at its casinos and online platform, highlighting an industry-wide issue. Despite multiple representations to the government, the demands persist.
Delta Corp maintains that these tax demands are arbitrary and contrary to the provisions of the law. Legal proceedings have been initiated to challenge these demands, reflecting the company’s commitment to resolving regulatory hurdles through legal channels.
Delta Corp’s financial report for the first quarter of 2024 underscores the challenges and opportunities within India’s gaming industry. While facing declines in certain segments, the company exhibited resilience through strategic initiatives, resulting in a significant increase in quarterly profit.
However, ongoing legal challenges, particularly related to GST demands, pose significant uncertainties for Delta Corp and the broader gaming industry. The company’s decision to contest these demands through legal channels reflects its commitment to upholding regulatory compliance while safeguarding its financial interests.